"These secretive investment companies have pumped billions of dollars into fossil fuel projects, buying up offshore platforms, building new pipelines and extending lifelines to coal power plants."
"As the oil and gas industry faces upheaval amid global price gyrations and catastrophic climate change, private equity firms — a class of investors with a hyper focus on maximizing profits — have stepped into the fray.
Since 2010, the private equity industry has invested at least $1.1 trillion into the energy sector — double the combined market value of three of the world’s largest energy companies, Exxon, Chevron and Royal Dutch Shell — according to new research. The overwhelming majority of those investments was in fossil fuels, according to data from Pitchbook, a company that tracks investment, and a new analysis by the Private Equity Stakeholder Project, a nonprofit that pushes for more disclosure about private equity deals.
Only about 12 percent of investment in the energy sector by private equity firms went into renewable power, like solar or wind, since 2010, though those investments have grown at a faster rate, according to Pitchbook data.
Private equity investors are taking advantage of an oil industry facing heat from environmental groups, courts, and even their own shareholders to start shifting away from fossil fuels, the major force behind climate change. As a result, many oil companies have begun shedding some of their dirtiest assets, which have often ended up in the hands of private equity-backed firms.
By bottom-fishing for bargain prices — looking to pick up riskier, less desirable assets on the cheap — the buyers are keeping some of the most polluting wells, coal-burning plants and other inefficient properties in operation. That keeps greenhouse gases pumping into the atmosphere."
Hiroko Tabuchi reports for the New York Times October 13, 2021.
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